Mahler v. Campagna

• Decision Date: 31 March 2009
• Docket Number: 2007-09036.
• Citation: 876 N.Y.S.2d 143,60 A.D.3d 1009,2009 NY Slip Op 02570
• Parties: DAVID J. MAHLER, Appellant, v. THOMAS K. CAMPAGNA et al., Respondents.
• Court: New York Supreme Court — Appellate Division

60 A.D.3d 1009

876 N.Y.S.2d 143

2009 NY Slip Op 02570

DAVID J. MAHLER, Appellant, v. THOMAS K. CAMPAGNA et al., Respondents.

2007-09036.

Appellate Division of the Supreme Court of the State of New York, Second Department.

Decided March 31, 2009.

In an action, inter alia, to recover the overpayment of legal fees and damages for legal malpractice, the plaintiff appeals, as limited by his brief, from so much of an order of the Supreme Court, Nassau County (Feinman, J.), entered August 10, 2007, as, in effect, granted those branches of the defendants' motion which were pursuant to CPLR 3211 (a) (5) to dismiss the second,

third, fourth, fifth, and sixth causes of action as barred by arbitration and award and by the doctrines of res judicata and collateral estoppel, and for summary judgment dismissing those causes of action.

Ordered that the order is modified, on the law, (1) by deleting the provisions thereof granting those branches of the defendants' motion which were pursuant to CPLR 3211 (a) (5) to dismiss the third cause of action to recover damages for legal malpractice and for summary judgment dismissing that cause of action and substituting therefor provisions denying those branches of the motion and (2) by deleting the provisions thereof granting those branches of the defendants' motion which were for summary judgment dismissing the second, fourth, fifth, and sixth causes of action and substituting therefor provisions denying those branches of the motion as academic; as so modified, the order is affirmed insofar as appealed from, without costs or disbursements.

The plaintiff retained the defendant attorney Thomas K. Campagna on January 16, 2003, to represent him in a matrimonial action. The matrimonial action was settled by stipulation dated April 2, 2005. Subsequently, the plaintiff filed a grievance against Campagna with the Grievance Committee for the Tenth Judicial District, seeking, among other things, "fee arbitration." An arbitration hearing was held and, in an arbitration award dated April 24, 2006, the arbitrators determined that the amount in dispute was $34,500, and awarded the plaintiff a refund from Campagna in the sum of $1,625. The plaintiff thereafter commenced this action on March 8, 2007, against Campagna and his professional corporation, Thomas K. Campagna, P.C., to recover an alleged overpayment of legal fees, and to recover damages for breach of fiduciary duty, legal malpractice, breach of contract, fraud, and violation of Judiciary Law § 487.

The defendants moved, inter alia, pursuant to CPLR 3211 (a) (5) to dismiss the complaint as barred by arbitration and award and by the doctrines of res judicata and collateral estoppel, and pursuant to CPLR 3211 (a) (7) to dismiss the second, fourth, fifth, and sixth causes of action for failure to state a cause of action. The defendants simultaneously moved, pursuant to CPLR 3211 (c), to convert the motion to dismiss the complaint into a motion for summary judgment dismissing the complaint, if the court deemed conversion to be appropriate. In an order entered August 10, 2007, the Supreme Court, in effect, granted those branches of the defendants' motion which were to dismiss the complaint pursuant to CPLR 3211 (a) (5) and for summary judgment dismissing the complaint. We modify.

The doctrine of res judicata operates to preclude the reconsideration of claims actually litigated and resolved in a prior proceeding, as well as claims for different relief against the same party which arise out of the same factual grouping or transaction, and which should have or could have been resolved in the prior proceeding (see Matter of Kafka v Meadowlark Gardens Owners, Inc., 34 AD3d 676, 677 [2006]; Luscher v Arrua, 21 AD3d 1005, 1007 [2005]). The doctrine of collateral estoppel bars relitigation of an issue which has necessarily been decided in a prior action and is determinative of the issues disputed in the present action, provided that there was a full and fair opportunity to contest the decision now alleged to be controlling (see Tydings v Greenfield, Stein & Senior, LLP, 11 NY3d 195, 199 [2008]; Buechel v Bain, 97 NY2d 295, 303-304 [2001], cert denied 535 US 1096 [2002]; York v Landa, 57 AD3d 980 [2008]). The party seeking the benefit of the doctrine of collateral estoppel must establish that the identical issue was necessarily decided in the prior action and is determinative in the present action (see Buechel v Bain, 97 NY2d at 304). Once the party invoking the doctrine discharges his or her burden in that regard, the party to be estopped bears the burden of demonstrating the absence of a full and fair opportunity to contest the prior determination (id.).

The doctrines of res judicata and collateral estoppel apply to arbitration awards with the same force and effect as they apply to judgments of a court (see QDR Consultants & Dev. Corp. v Colonia Ins. Co., 251 AD2d 641, 642 [1998]; Dimacopoulos v Consort Dev. Corp., 158 AD2d 658, 659 [1990]; Luppo v Waldbaum, Inc., 131 AD2d 443, 445 [1987]).

The Supreme Court erred in granting those branches of the defendants' motion which were to dismiss the third cause of action to recover damages for legal malpractice on the ground that it was barred by arbitration and award, res judicata, and collateral estoppel, and awarding summary judgment to the defendants dismissing that cause of action. The defendants failed to sustain their burden of demonstrating that all of the issues raised in the instant action which are or may be determinative thereof were necessarily decided in the arbitration proceeding, which, it is undisputed, was conducted pursuant to part 137 of the Rules of the Chief Administrator of the Courts (22 NYCRR 137.0-137.12; hereinafter part 137). Part 137, entitled "Fee Dispute Resolution...